Marketing ROI has been historically difficult to track and measure. The biggest reason for this is that the vast majority of traditional marketing outlets are one-way. These outbound marketing channels allow advertisers to present messages to an audience, however, they have no mechanism to track the effectiveness of that message. Sure, you might have data that shows how many listeners tune into a radio station, but you have no real way to show who listened to your ad or who was ordering drive-thru while your ad was playing. It just isn’t possible. Below, we will look at average costs of typical outbound marketing tactics compared to inbound marketing expenses. We will look at the effectiveness of each and how you can track the Marketing ROI of Inbound Marketing endeavors.

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Average Traditional Advertising Costs by Media Type

Newspapers: Companies spend anywhere from $250 to $2500 dollars per week for newspaper advertising depending on the market and size of the display ad.

Radio: Advertisers can find themselves out $100-$300 bucks per week for rotating spots. Expect to pay more if you want a specific slot.

Television: Expect to pay upwards of $200k or more for prime-time national spots. Local markets can still charge hundreds of dollars per week for your 30-second promotion.

Magazines: Care to cough up $100k or more for a full page in that national magazine? Even small ads will run you thousands of dollars per month.

Local Publications: It costs a lot to print local interest newspapers and magazines, and they make all of their income from ad sales. Even small business-card type ads in these business journals and entertainment mags will set you back a few hundred bucks a month.

Yellow Pages: An average half page yellow book ad will run you over $1,000 per month.

What is your Return on Investment?

This will be a very small paragraph. Why? Simply because it is practically impossible to calculate effectiveness of the above types of advertising. Sure the newspaper might have a circulation of 50k readers, but you have no idea how many actually looked at your ad. A billboard might be in a high traffic area but you’ll never know how many people were persuaded by it. Traditional outbound advertising

Average Costs of Inbound Marketing Components

In contrast to traditional marketing outlets, or outbound marketing – let’s look at some average costs of internet marketing which falls more under the category of inbound marketing. In other words – instead of disruptive and interruptive advertising that we have all learned to tune out, inbound relates to an audience that is actively seeking you out.

Average Small Business Website: Expect to pay anywhere from $2500 – $15000 depending on the age and stage of the design firm you employ. Some firms will have monthly payment terms to decrease the impact of this expense.

Average Search Engine Optimization Campaign: Users ARE searching for your products or services right now. To dip your cup into that stream, you have to optimize your website to ensure that they find you. This is called Search Engine Optimization – or SEO. Prices for these services can range from $500 – $5000 per month, again, depending on the age and stage of the consultant or agency you employ.

Pay Per Click Campaign: It is also possible to bid for clicks in the Google Adwords market place. A typical Adwords campaign can often run anywhere from $500 – $2500 per month depending on your budget.

Social Media Marketing and Other Inbound Marketing Services: Specialists can charge anywhere from $1000 to $10k per month for specialized services, depending on how much time they put into your project each month.

Return On Investment for Inbound Marketing

In stark contrast to traditional outbound marketing activities, every single aspect of online marketing can be measured, tracked and analyzed. A website doesn’t guarantee increased business – that all depends on how persuasive the website is and how well it is used within your strategy. However, you will know exactly how many visitors you have had, what pages they looked at, and how long they spent looking at them. You will know where they came from and what keywords they used to arrive there. In fact, you will be armed with lots of marketing intelligence, that, when used properly, will help you hone your online marketing strategy into an efficient lead generating tool.

Tracking Marketing ROI for Inbound Marketing Strategies

Now we can get down to the nitty gritty. Tracking return on investment for Inbound Marketing strategies is easy. For instance, let’s say you employ an inbound marketing firm to handle all aspects of your inbound marketing strategy, creating content, generating leads and tracking your customer’s behavior. At any point the agency will be able to talk with you about statistics concerning your marketing strategy. We’ll use the following table to illustrate.

Monthly Inbound Marketing Service Fee

$5000

Monthly Traffic Generated

100,000 Visitors

Monthly Leads Generated

2000 (at 2% conversion)

Monthly Sales Generated

$12,000

Monthly ROI

140% Return

The numbers above are simply an illustration and are designed to make the calculations simple. The point is, however, with outbound marketing you will never have the kind of data to even perform this kind of Marketing ROI calculation. With Inbound Marketing, however, you will have this kind of data and more. Sometime actions will show a return. Sometimes they will not, but having the power to measure means that you can intercept poorly performing strategies and make adjustments to protect your investment. That billboard you spend $5,000 on last month… you’ll never really know if it was worth it or not!

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